Monday, January 25, 2010

Many vodka producers make a big deal about the source of the water used in their products. There are claims of glacial water sources, deep well water, water from exotic locations, etc. But really, how important is the water that is used in making vodka?

When making our vodka, we introduce water directly in our process (as opposed to water used for heating and cooling that never comes in contact with the product) at three different points. First is the water used for creating our mash (see Mashing). Second is water we add back to produced alcohol before the final distillation. In both cases, this water ends up being distilled, so, although we use clean water to begin with, if there were any impurities they would be cleaned up. The third point in the process where water is introduced is the most significant; the addition of water to dilute the 95% alcohol produced to 40% alcohol for the final product. For any vodka producer, the water used for dilution is the water that is most important to the quality of the finished product.

For our Single Malt Vodka, we use only three ingredients: malted barley, yeast and water. Other producers might use a different type of grain (e.g. wheat or corn), a combination of grains, or more rarely potatoes, beets or some other natural source of sugar. The yeast may play a role in determining the vodka character, but its effect on taste and aroma are probably negligible. Some vodka producers may also add other ingredients to their product, such as glycerin (see Does Grey Goose Contain Glycerine?) which most definitely does affect the taste and aroma of the vodka. The processes used to distill and the unique techniques from one distiller to another also play a role. We feel that the grain contributes the most character to our vodka, as it does for most vodkas we have tried. As a result, we don't want the water we use to affect the taste of our product. Our desire is for the water to be as neutral as possible.

Even if other producers use water from unique sources, there is good reason for them to treat their water first. Water, whether from municipal sources, natural sources or from some exotic origin, will surely contain impurities. Water is often very rich in minerals. However, alcohol reduces the solubility of minerals as does temperature (and most people enjoy their vodka chilled). Therefore, mineral rich water, regardless of its source, will become cloudy when added to alcohol. This may also cause precipitate to form in the bottle, especially at low temperature. Most of us will agree that a cloudy looking vodka is undesirable, and thus the need to use "soft water", removing impurities from the original water.

The process used by Still Waters Distillery involves a combination of carbon filtering the water, softening the water, and using reverse osmosis. We remove chlorine, chloramines, fluoride, etc. as well as the minerals in the water. Thus, the water we add to our vodka to dilute it is very pure and clean. (We also chill-filter the final product after dilution and before bottling.)

We don't believe that the water we use imparts any flavour to our vodka. We also believe that this is true for most producers, out of necessity. I would be much more concerned with the other ingredients used by distillers and the processes and techniques they use to distill their products.

Wednesday, January 20, 2010

Its tough to be the trailblazer. Here in Ontario, we are the first (and only, so far) artisan distiller, micro-distillery, craft distiller or "grain to glass" operation. Just like the rise of micro-breweries and small wineries over the past few years, we hope that there will be greater interest in grain to glass artisan distilleries that produce high quality unique spirits for an increasingly educated and sophisticated market. We know that being the first is not easy, but we are determined to be successful, just as the handful of others in other provinces have, and the more than 200 such operations in the U.S. have to date.

Friday, January 15, 2010

As we start laying down our first barrels of whisky, we have had to make some tough decisions. Though our choice of grain, yeast and water along with our mashing, fermentation and distilling techniques will influence the quality of the final product, it is thought that up to 80% of the character of a whisky comes from the oak cask in which it is matured. There are lots of options for our casks, and we have to make some choices. This is actually quite hard since we won't know whether or not we made the right decisions for several years.

By law, we have to mature our whisky in wood for a minimum of three years. (This is a Canadian law. Other countries may have different regulations. For example, Bourbon Whiskey only needs to be matured for two years according to U.S. law.) This gives us a great deal of leeway. We are free to age our whisky for more than three years. We desire a quality product, and aging longer may be necessary to obtain a whisky we are happy with. On the other hand, the longer it sits, the longer we have to wait before we can sell it and the cost of carrying maturing whisky without sales is a consideration, especially for a craft distiller with limited resources. It is also possible that it can sit in the barrel too long, imparting characteristics to the whisky that are undesirable.

Oak casks are used around the world for maturing of whisky. American law dictates that Bourbon Whiskey must be matured in new oak. This creates a large market for used bourbon barrels and most Canadian Whisky and Scotch Whisky is, therefore, matured in ex-Bourbon barrels. It has become common to see whiskies aged or "finished" (i.e. matured for a short period of time at the end of the aging period) in other types of used barrels, such as sherry or rum casks. We are under no obligation to use ex-Bourbon barrels. We have decided to try a combination of ex-Bourbon barrels, new oak barrels and even other oak barrels previously used for other types of alcohol. However, even that decision brings choices. The species of oak plays a role given the variations in cell structure. American oak is the most common, but there is growing interest in Canadian oak, currently being used by some Canadian wineries. Size standards also vary and the size of the cask plays a role given the varying surface to volume ratios. Many distilleries are now experimenting with maturing or finishing their whiskies in smaller barrels to simulate longer aging. We will likely try this as well.

The conditions under which the maturing cask is kept influence the aging process. Evaporation from the porous wood always occurs. This is known as the angel's share. Scotch Whisky experiences about 2% loss a year. It is known, however, that whisky maturing in other parts of the world have a much higher rate of evaporation. Factors like the original strength of the spirit, altitude, temperature, humidity, and air flow all play a role. We are very concerned that we don't have excessive loss to the angel's, since we will have less product to bottle in the future and, therefore, at a higher cost.

There is a great deal of research into the whisky maturing process. It is known that there are chemical changes that occur to the whisky in wood due to two different processes. Additive activity introduces new aroma and flavour compounds to the whisky, coming from cask-derived congeners (chemical constituents). Barrels are charred before use, and this creates a high level of colour and extractives in the wood. Aroma compounds such aslactone (coconut) and eugenol (spice and clove) and, for refill barrels, elements from the previous contents, get added. Subtractive activity, on the other hand, involves chemical reactions that take place that remove or alter constituents in the whisky. This activity includes evaporation and absorption. The charred surface of the cask also causes chemical degradation reactions such as oxidation.

Despite the known scientific knowledge on whisky maturing, the process is still largely a mystery. Experienced distillers can try to control and predict the process. Ultimately, however, the colour, aroma, and taste of the final product is somewhat of a gamble. We are trying a few different permutations of wood type, new and used barrels of different origins, and cask size. We anxiously wait for the first three years to pass so that we can see the results and determine if more time is necessary. There is risk. What if the final product is not good? We cannot role back the clock and start again. We keep our fingers crossed that most of our (educated) guesses will pay off and we will have some unique and exceptional whiskies in a few years time.

Tuesday, January 12, 2010

Packaging of consumer products is an important aspect of product marketing. For retail products of any sort, the packaging is one of the primary differentiators of the product from its competitors. The packaging gives the buyer a perception of a product that is being purchased for the first time. The product quality must be good enough so that subsequent purchases will be made, but if the product fails to capture the attention of the consumer initially, then it is that much more difficult to entice the consumer to try it.

These general observations about product packaging definitely apply to alcoholic beverage products. In certain categories this is especially true. The vodka market has seen phenomenal growth over the last few years. There are new vodkas introduced constantly and competition is fierce. What is particularly interesting about the vodka market is that there is often only very subtle differences between different brands (see Vodka Myths and Facts). The packaging, therefore, must be a key element in the marketing strategy to differentiate one vodka from another. The packaging must capture the attention of the consumer so that the bottle stands out from others.

So, what is the packaging dilemma? Well, for micro-distillers, competing with the big brands becomes challenging. We understand the value of marketing and packaging. However, we do not have global marketing and sales teams. We only produce a fraction of what a major brand produces (hence, "micro" distillery) and, therefore, cannot afford to spend significantly on promotion. Most micro-distillers price their products in a way that reflects the true cost of making the product. That is, our pricing is based on the raw ingredients, labour and packaging, with little extra for marketing and sales costs. For us, an outstanding package on the shelf might mean a signifiant price increase to the consumer.

Our Single Malt Vodka, for example, compares favourably to the ultra-premium vodkas on the market. We believe the product is unique and we have tried to convey that message on the bottle's label, both front and back. We also believe that our product competes well on price. The challenge is in the packaging. We are aware that we are not as "attractive" on the shelf next to many other vodkas and are constantly working with consumer and retailer feedback to re-examine our packaging. We can go all out and make a product that really stands out, but the price of that product will rise significantly.

Most consumers would be shocked to learn that the actual price of an alcoholic beverage includes significant markups and taxes. The amount actually received by the producer is a fraction of the retail price. Furthermore, the packaging cost can be a large part of the cost of the product. We know of many alcohol products where the packaging makes up most of the product cost. For a micro-distiller, this is even more of a challenge due to the lack of volume buying power. For example, the bottle itself is expensive. Finding unique glass is difficult and extraordinarily expensive. A large producer can afford a custom made bottle and the minimum quantities needed to justify the expense of molds, production and storage. A micro-distiller cannot usually afford to even purchase a stock bottle (that may not be as unique) in quantities that enable them to save money. Container loads of bottles would need to be purchased, and I don't know of many micro-distillers that could afford to buy 40,000 bottles in one shot, let alone have the space to store them.

So, our dilemma is packaging. We have worked hard to create a unique, high quality product. Should we spend more money to enhance the shelf-appeal of our product in order to entice more people to try it, but increase our price in order to be able to afford to do so? I'm interested in knowing what you think.

Wednesday, January 6, 2010

The craft distilling industry in Canada is in its infancy. There are only a handful of artisan or micro-distillers across the country, with only one in Ontario. In the U.S., the American Distilling Institute reports that there are 151 craft distillers. There are many other licensed distilleries in Canada and the U.S. that are not true craft distillers. They are either very large, do not produce their products in their entirety (i.e. just involve themselves with part of the process) or perhaps don't produce at all. For example, they may outsource their entire production or just package spirits produced elsewhere.

There doesn't seem to be a definitive definition of what constitutes a craft distiller, but distilling capacity and total volume produced annually give a good indication of whether the distillery can be considered a micro-distillery. So, while an objective test doesn't exist, I thought I would suggest 5 questions that can be asked of a distillery to help you determine if they are, in fact, a true craft distiller:

1. Tell me about your still.

A craft distiller should be able to tell you what type of still they have, the manufacturer, and its size. For example, our still is a 450 litre pot still with two rectification columns, manufactured by Christian Carl, to our specifications, in Germany. Most micro-distillers are proud of their equipment and love to talk about it. Be very suspicious if someone claiming to be a distiller cannot or will not tell you this very basic information. Some "craft distillers" do not even posses a still, yet will talk about how they distill their products. Its only when you ask them for details on their equipment that you realize they don't actually create the alcohol themselves.

2. What are your ingredients?

Spirits contain very few ingredients. (Gin being an exception, since a combination of botanicals are used to infuse the alcohol.) A craft distiller should have no problem naming the few ingredients used. For example, we use 100% malted barley, yeast and water. (Again, gin is an exception and a gin producer might not want to share all the details of their unique botanical mix.) If a distiller simply says "grain" and is unable to give you more details, then be very suspicious. It could be that they are simply buying NGS, or Neutral Grain Spirit, from an industrial processor and then just filtering it or running it through their still to claim they distilled it. I do not consider that process to be true craft distilling.

3. What is your capacity?

This is a crucial question. A micro-distillery must be keenly aware of their capacity since they need to manage their resources and time very carefully. Someone that simply purchases NGS and further processes it and bottles it can scale capacity to a high degree. On the other hand, a true craft distiller is limited by their equipment and the natural time it takes to make their product. They should be able to tell you how many cases they can produce a week or in a year. They should be able to give you very specific information on the time it takes them to create a mash, do a stripping run, etc. They will be able to tell you the size of each tank they posses.

4. Do you produce your own mash?

This is not a 100% accurate indicator of whether a producer is a true craft distiller, but gives some important information. Some micro-distillers will buy their wash from a brewery rather than making it themselves. Many do, however, produce their own mash in order to have complete control over the process. In either case, a micro-distiller will be able to tell you all about the process used. It is the creation of the wash that produces the initial alcohol used in the process. Therefore, we believe it is very important to do this ourselves.

5. Show Me!

The craft distillers I have met are very proud of what they do and want to show off. Ask to see how they make their products. Do they offer tours? Do they describe their process and/or show you what they do and how they do it on their website? Still Waters Distillery wants our customers to see how the products they enjoy are made and, even though we are not open to the public, we are anxious to show you how it is done at Still Waters Production Process.

There are so-called micro-distilleries that are licensed distilleries jumping on the craft distilling bandwagon without investing in the equipment or the expertise to create their own products from beginning to end. They are mostly marketing organizations trying to capitalize on the trend. The real test for a craft distiller is their ability to answer questions. Like craftsman in other industries, true artisan distillers take great pride in what they do and are eager to share with others.